Meta to cut 10% of jobs to ‘offset’ Mark Zuckerberg’s AI spending

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Meta will cut 10 per cent of its staff next month, or about 8,000 jobs, as the social media platform reduces its workforce to offset chief executive Mark Zuckerberg’s AI spending spree.

The $1.7tn social media group on Thursday told staff in a memo that it was laying off staff in order to “run the company more efficiently and . . . offset the other investments we’re making”.

Meta also said in the memo that it was no longer filling 6,000 positions that it had planned to hire for, said two people familiar with the matter.

The cuts come as Zuckerberg spends billions of dollars on AI infrastructure, including a fleet of costly data centres, as well as on poaching elite talent in order to catch up with rivals such as Google and OpenAI in the race to build cutting-edge models.

Meta in January said capital expenditure could nearly double to $135bn this year. Investor anxiety over the spending has weighed on the company’s share price.

Zuckerberg has centred Meta’s AI strategy on developing what he calls “personal superintelligence”. This month, the company rolled out a new AI model Muse Spark, which it said had been “purpose-built” for use across its products including its Meta AI chatbot.

However, the company acknowledged the new model lags behind the most advanced tools from rivals and has insisted it will make further advances this year.

It has also announced new AI data centre project dubbed “Meta Compute”, aiming to build “tens of gigawatts this decade and hundreds of gigawatts or more”. A single gigawatt of data centre capacity costs tens of billions of dollars to build.

Big Tech rival Microsoft on Thursday told staff it was offering voluntary redundancy to about 7 per cent of its US workforce.

Janelle Gale, Meta’s chief people officer, said the lay-offs would take place on May 20 and those affected would receive “a generous severance package”, including healthcare coverage for 18 months for US employees.

The uncertainty has prompted nervousness among staff, many of whom complain they have suffered through multiple rounds of bruising lay-offs, restructurings and executive shake-ups over the past two years as Zuckerberg pursued his AI bet.

“I know this leaves everyone with nearly a month of ambiguity which is incredibly unsettling,” Gale wrote in the memo.

Separately, staff have been unnerved by news that the company plans to install tracking software that would capture their mouse movements, clicks, keystrokes and screen content in order to train AI models.

The data will help Meta to build agents that can autonomously carry out work tasks, giving rise to fears that staff are training models that might replace them.

Meta has also been encouraging employees internally to embed AI into their working practices including coding activities. Reuters first reported news of the lay-offs and tracking software.